Analysis: Obama, GOP disagree, again, on spending

WASHINGTON (AP) -- After two tumultuous years of budget brinkmanship, President Barack Obama and Republicans in Congress finally agree on something -- namely, that a previous 10-year pact to cut $1 trillion across the board was such a bad idea it must be stopped before it starts.

If consensus counts as good news in an era of divided government, consider this: They also disagree vehemently on a suitable replacement.

As a result, they seem likely to spend the spring and perhaps a good part of the summer struggling to escape a bind of their own making. And this time, Medicare and the rest of the government's benefit programs are likely to face changes.

Already, the two sides are laying down markers.

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Obama called on Congress on Tuesday to join him in developing a replacement for the across-the-board reductions, "a balanced mix of spending cuts and more tax reform."

"We can't just cut our way to prosperity," he told reporters at the White House.

Senate Republican leader Mitch McConnell had a different view. "If Democrats have ideas for smarter cuts, they should bring them up for debate," he said, noting that the GOP-controlled House already has produced an alternative.

"But the American people will not support more tax hikes in place of the meaningful spending reductions both parties already agreed to and the president signed into law," McConnell said, a reference to legislation earlier this year that raised taxes at upper incomes by $600 billion.

For their part, majority Republicans in the House welcome the debate after calculating that their leverage with Obama would increase once he asked lawmakers for repeal of the across-the-board cuts.

In fact, the across-the-board reductions themselves were born almost of desperation, designed to be so unpalatable that they would force members of a 2011 congressional supercommittee to agree on a sweeping anti-deficit plan rather than let them take effect.

The panel deadlocked. The cuts have been delayed by two months but are set to kick in on March 1 -- $483 billion out of defense over a decade and roughly the same out of a variety of domestic programs. Medicare, Medicaid and Social Security benefits are untouched.

The cuts -- known in Washington-speak as a "sequester" -- have not gotten any more popular in the intervening months.

"President Obama proposed the sequester, insisted the sequester become law and then doubled down on keeping the sequester in place," Rep. Cathy McMorris Rodgers of Washington asserted Tuesday, one of numerous Republicans to do so.

Few if any political leaders care to defend the automatic cuts, and the nonpartisan Congressional Budget Office said Tuesday they would slow economic growth if they take effect.

The nation's top uniformed officials warned lawmakers recently of dire consequences from even one year's allotment of cuts planned for the Pentagon. "We will have to ground aircraft, return ships to port and stop driving combat vehicles in training," members of the Joint Chiefs of Staff wrote to Congress.

A group of liberal House Democrats wants to replace across-the-board cuts with nearly $1 trillion in higher taxes over a decade, at the same time calling for changes to earlier deficit deals they opposed. The effect would be a "fair, balanced approach that protects working families," they said.

But both groups stayed away from the core reason that Obama and Republicans are at odds. In deficit deal-making to date that totals $3.6 trillion over a decade, the government's costly benefit programs -- Medicare, Medicaid and Social Security among them -- have been largely untouched.

Both Obama and congressional Republicans have backed suggested savings from Medicare and even Social Security in earlier rounds of talks but, for a variety of reasons, omitted them from the final deals.

Now they're back, at the center of the debate.

Speaking to reporters at the White House, Obama made a point of saying that proposals he had made late last year in talks with House Speaker John Boehner "are still very much on the table."

"I've offered sensible reforms to Medicare and other entitlements, and my health care proposals achieve the same amount of savings by the beginning of the next decade as the reforms that have been proposed by" a bipartisan commission, the president said.

Among them is a measure to slow the annual rise in benefits under Social Security and a variety of other government programs -- an approach many congressional Democrats have opposed and like to use as a weapon against Republicans when they suggest it.

McConnell's office noted that the Senate's top Republican leader proposed "more than $100 billion in bipartisan spending reductions" in last winter's talks, some related to Medicare. All were rejected by the administration, the statement added, including a $30 billion item that tracked a proposal Obama had advanced requiring wealthier Medicare beneficiaries to pay more for their care.